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, hospitality industry leaders are looking toward 2026 with careful optimism. Increasing operational costs are slated to challenge owners this year and lower-tier sectors could have a hard time amid a growing wealth bifurcation.

And through it all, hotel companies are expected to fortify their portfolios with brand-new brand offerings and partnerships. As the year gets underway, Hotel Dive spoke to hospitality leaders from differing corners of the industry about their 2026 forecasts. Below are the top trends anticipated to impact hotel operations, performance, net unit development and more this year.

Overall incomes, earnings and benefits paid by U.S. hotels rose to $127 billion in 2025, according to information from the American Hotel & Lodging Association, shared with Hotel Dive. In 2026, that figure is forecasted to climb up to $131 billion, representing a roughly 3% year-over-year increase, per AHLA. For hotel owners, increasing labor expenses position an obstacle to net operating earnings growth, Kevin Davis, Americas CEO at JLL Hotels & Hospitality, told Hotel Dive.

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"It is an absolute issue." Increasing labor costs have actually been a difficulty for hoteliers for many years, Davis stated, especially following the COVID-19 pandemic. Overall, hotel labor costs have actually increased 15.3% from 2019 to 2025, outmatching the 12.8% growth in total operating earnings, according to AHLA. Over the last few years, thousands of union hotel employees have gone on strike demanding higher incomes in order to keep up with the rising cost of living in locations such as California, Hawaii and Las Vegas.

3, 2024 in San Francisco, California. Justin Sullivan via Getty Images In 2026, Davis noted, union negotiations will be "front and center" in New york city City, where the New York City Hotel and Video gaming Trades Council's union agreement with the Hotel Association of New York City is set to end in July.

Last year, the union backed New york city City's freshly chosen Mayor Zorhan Mamdani, who ran on a pledge to raise New York City's minimum wage to $30 per hour by 2030. Hotel market associations, including AHLA, have knocked comparable legislation throughout the nation, including the just recently passed $30 wage regulation in Los Angeles. "Demand has not kept up with this speed," she said. "We're also seeing these obstacles compounded by legislation that targets hotel operations, such as severe labor and licensing policies like the New York City City Safe Hotels Act. When need is falling and costs are soaring, the math simply does not include up." Salaries, salaries and payroll-related costs paid by hotels now represent more than 32% of overall profits, according to AHLA.

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As more hotel visitors turn to expert system to enhance their travel experience, scheduling hotels straight through large language models (LLMs) may be next, hospitality specialists stated. Agentic commerce a procedure by which autonomous AI agents act on behalf of a consumer to find, compare and complete purchases is a pattern that has sped up throughout industries like retail.

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According to PwC's 2025 Vacation Outlook report, 76% of millennials said they're most likely to use AI for travel suggestions. A smaller portion (57%) stated they 'd be most likely to use it for reserving travel. That number is growing, Jonathan Kletzel, PwC's travel, transport and logistics leader, informed Hotel Dive. "The number of customers that are searching [via LLMs] for product or services in travel has actually swollen in the last 12 months and is accelerating every day," Kletzel said, adding that undoubtedly, hotels will "take a difficult take a look at how they can make it possible for commerce and deals through agentic [AI]"" [Brands] can build on the trust they currently have if they do a terrific job with how they handle AI in 2026." Michael Klein Head of retail, travel and hospitality product marketing at Talkdesk To remain competitive with direct booking, bigger multibrand hotel business will "embed LLMs into their own brand websites and mobile apps, and change the way the consumer searches," Kletzel said.

"If you are not discoverable in an LLM search engine result which numerous brand names aren't, and this is the huge panic that they're all going through today consumers aren't going to consider you," he stated. Michael Klein, head of retail, travel and hospitality product marketing at AI client experience platform Talkdesk, likewise informed Hotel Dive that hospitality gamers need to ensure their property information is being indexed by LLMs to appear in traveler queries.